OFT likely to investigate 3G network sharing

20 Feb 2007

Plans by UK wireless network operators Vodafone and Orange to cut costs by combining their 3G mobile phone networks are likely to face scrutiny from the Office of Fair Trading (OFT). A report carried by The Times suggests the competition watchdog is preparing to initiate an inquiry into the pair’s plans, including whether the tie-up constitutes a merger. The move comes as O2 considers a similar network-sharing plan. O2, whose 3G network covers only about 60% of the population, in particular stands to benefit from such a move. A tie-up could help it to hit its required target of covering 80% of the population with its 3G network by the end of the year.

Taking such a cost-saving ‘shortcut’ would anger rival 3, however, which was the first to hit the 80% requirement. It has written to telecoms regulator Ofcom to advise that a lax approach towards other operators meeting the target could constitute potential discrimination against it.